Archive for the ‘federal’ tag
Refinance Fees Tax Deductible
Should I pay a $1770 fee to refinance a 5.5%,12yr mortgage to a 4.75%,10yr term (Tax Bracket = 28%, P = 127k)?
Assuming that I can invest the money elsewhere to get a 4.5% return (after taxes), I don’t think I will break even if I refinance. Does this sound right? I am assuming that all my mortgage interest payments are tax deductible.
P stands for Principal remaining on mortgage.
Up to you…below is the math
5.5% 12year
$46,767 Total Interest Paid at payoff
4.75% 10year
$32,787.96 Total Interest Paid
I personally would pay the $1,700 to save $14,000 over the course of the loan (assuming you don’t sell or move out)
Your Loan Mod Fee is Now Tax Deductible